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Bank of Canada holds key rate at 0.5% (Unchanged)

OTTAWA—The Bank of Canada is holding its benchmark interest rate at 0.5 per cent as economic conditions move along largely in line with its expectations.

Bank of Canada holds key rate at 0.5%

The central bank said while the global economy has strengthened, persistent international uncertainty has continued to have a negative effect on business confidence and investment.

In making the scheduled announcement Wednesday, the central bank said while the global economy has strengthened, persistent international uncertainty has continued to have a negative effect on business confidence and investment among Canada’s trading partners.

The bank said in a statement that Canada’s growth performance had also been close to its expectations, including a strong rebound in the third quarter. It repeated its prediction that Canada would see “more-moderate growth” over the final three months of 2016.

However, it said Canadian inflation, which the bank carefully analyzes when making rate decisions, was slightly below what it had anticipated, in large part because of lower food prices.
In a closer analysis of economic conditions, the bank also made a point of highlighting recent steps taken by the federal government in an effort to help boost growth.